According to European Commission 2016 forecast, GDP in Serbia is expected to grow 2% in 2016 and 2.5% in 2017, said Head of European integration sector of the EU Delegation to Serbia Freek Janmaat.
At the press briefing, Janmaat said that European Commission’s forecast for Serbia was looking up due to export growth and production increase enabled by previously implemented economic reform and new laws on labour, construction land and inspection.
Among the reasons behind the GDP growth, European Commission named the steady growth of both domestic and foreign investment in all sectors, adding that this tendency is expected to continue.
The decision made by National Bank of Serbia to cut key interest rate is assessed as another positive step, considering its attractiveness among investors.
However, according to Janmaat, foreseen growth rate is threatened by a possible delay in the implementation of Government reforms, e.g. in the area of privatisation of public enterprises, restructuring of public enterprises and public sector downsizing.
“The European Commission considers such a delay to be a potential risk because it would certainly affect the fiscal policy,” Janmaat said.
He added that the European Commission had no knowledge that debt guarantees for 11 socially-owned enterprises, due to expire on 31 May, would be extended by the Government.
Photo: FoNet
“However, bearing in mind high subsidies which hindered market competition in the past, it would be a good thing to resolve the issue of socially-owned and public undertakings,” Janmaat said.
Speaking about fiscal consolidation in Serbia, Janmaat said the EC expected the Government to reduce its expenditures in 2016 and assessed the 2016 budget deficit to stand at 3.1% of GDP, with a slight decrease to 2.9% in 2017.
According to European Commission assessment, unemployment rate in Serbia in 2016 will stand at 17%, whereas in 2017 the EC expects further decrease by 0.8%.
Asked by the press to comment on the talks between the Government and the EU regarding the sale of Zelezara Smederevo to a Chinese partner, as well as the sale of Air Serbia, Janmaat said the two sides led a continuous dialogue on these issues.
“At this point, I cannot know the duration and outcome of these talks. That is all I can say,” said Janmaat about Zelezara Smederevo.
Regarding the sale of Air Serbia to Etihad Airways, he said that, within the dialogue, Serbian Government was expected to submit the requested information.
